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Statements on Agriculture Dáil Eireann 4 May 2016

Ceann Comhairle, Colleagues,

At the outset I would like to record my congratulations to the new President of the Irish Farmers Association, Joe Healy. It will be important that members unite behind him in the interests of agriculture and I wish him well in his tenure as President.

Colleagues, as you will be aware, the agri-food sector has performed strongly in recent years despite very difficult economic circumstances, with exports reaching an estimated €10.83 billion in 2015, an increase of more than 50% since 2009.

However, price volatility has been an increasing feature of agricultural markets in recent times.  

My Department has introduced a number of measures to support farmers in this context:

•    Volatility package agreed by the Agriculture Council in September for dairy and pigmeat sectors; €27m
•    Taxation: the extension of income averaging from three to five years in Budget 2015.
•    2014-2020 Rural Development Programme; vital support through farm investment, agri-environment and knowledge transfer schemes.

Access to finance

My Department also continues to explore additional funding mechanisms for the agri-food sector.

Since its launch the Strategic Banking Corporation of Ireland (SBCI) has made 4,619 loans amounting to €172 million drawn down by SMEs, 26% had been accessed by the agriculture sector.

The ‘Ireland Strategic Investment Fund’ (ISIF), Glanbia, Rabobank and Finance Ireland, announced the creation of a new €100 million ‘Glanbia MilkFlex Fund’ in March which will offer flexible, competitively priced loans to Glanbia milk suppliers with loan repayments which can vary according to movements in milk price.

Financial Instruments (FIs) are also being considered for inclusion in the Rural Development Programme. 

RDP/Payments

Turning now to recent developments in schemes being rolled out and payments to farmers;

The two main direct payment schemes delivered under the CAP are the ANC scheme and the Basic Payment Scheme. 

To date, payments of over €203 million have been made to 95,849 applicants under the ANC scheme.

Ireland is among the earliest to pay the BPS in the European Union and commenced payments on 16th October 2015. To date, 125,676 farmers have received payments totalling €1.144billion. This covers over 99% of applicants.

Preparations for the 2016 ANC and BPS are well underway, and the closing date for these schemes is May 16. I would urge all farmers to apply as soon as possible and to avail of the online facility to do so where possible.

TAMS II

During 2015, six new schemes were announced under Targeted Agricultural Measures (TAMS II). The second tranche for the TAMS II Schemes closed on 25 March and approvals will commence when all of the required checks have been undertaken.

Tillage and Sheep Fencing

I am delighted to announce that I have received informal approval from the Commission for the inclusion of a specific scheme of investment for Tillage Farmers and also for the inclusion of sheep fencing as an investment item under the existing TAMS Schemes.

Knowledge Transfer Programme

Under the new RDP, €100m is being provided to support farmer upskilling and training via Knowledge Transfer Groups.  Preparations are currently being finalised for the launch of Knowledge Transfer Groups across 6 sectors – beef, dairy, sheep, tillage, equine, and poultry.   

Dairy Sector

I am very conscious that the last 12 months have been a challenging time for dairy farmers due to decreasing prices. The longer term demographic and demand perspectives remain positive, but 2016 will be a challenging year.
The focus now is on helping producers through this time. In this respect, I very much welcome the package of support measures to address challenges in the dairy and pigmeat sectors agreed in Brussels at last month’s Council.

This package includes a number of proposals put forward by Ireland;

  • Doubling of the intervention ceiling for skimmed milk powder and butter.
  • Commissioner’s commitment to consider further flexibilities in the Private Storage Aid scheme for Skimmed Milk Powder, and to look at further flexibilities in the State Aid regime.

I have called on the Commission to consider looking at the temporary suspension of EU import tariffs on fertilisers and I understand that the Commission is looking favourably on this request. The Presidency conclusions also refer to the possibility of advance payments under CAP, as was done in 2015.

I also welcome the proposal for the European Investment Bank (EIB) and Member States to work together with the Commission on the feasibility of an EU export credit tool.

I convened a meeting of the Dairy Forum on the 9th March where I tasked the stakeholders present with developing on-farm financial planning for dairy farmers. This group met last week under the chairmanship of my Department, and agreed to organise a series of events this year in this regard.

Pigmeat

On pigmeat, prices have come under pressure over the last year and a half. Given the strategic importance which the sector plays in our agri economy, I established last year a Pig Industry Stakeholder Group which was chaired by Dr Sean Brady. The Group completed its report in February and presented it to the Food Wise 2025 High Level Implementation Committee. My Department is working now on a plan for its implementation in the context of the Food Wise 2025 strategy.

My priority at the March meeting of the Council of Agriculture Ministers in Brussels was to secure the re-opening of the Pigmeat Private Storage Aid Scheme and I am pleased to note that the Commission has agreed to the re-opening of this scheme in 2016. 

Ireland has also requested the Commission to intensify efforts to unlock the Russian market for EU pigmeat.

In the interim, a direct aid package payment has been issuing to all pig farmers in Ireland who have a minimum level of supply of 200 pigs slaughtered in 2015. This means a flat rate payment of over €3,000 to each farmer.

A specific €30 million envelope for dairy and pigmeat is being made available under the EU Promotion Scheme. Ireland, through Bord Bia, will be making an application for a proportion of this funding in the very near future.

Beef Data Genomics Programme (BDGP)

As Deputies are aware I have allocated €300 million to the BDGP scheme. The ambition is to generate an uplift in the quality of the genetic merit of the national herd, a more environmentally efficient herd as well as contributing to the income stream of suckler farmers. In total there are over 25,500 farmers in the scheme now and almost €38m has been issued in payments to approximately 20,700 of these applicants to date.

Producer Organisations

The establishment of a framework for Producer Organisations in the beef sector was a key outcome of the Beef Roundtable. I introduced a Statutory Instrument in February of this year which gives legal recognition for the first time in Ireland to Producer Organisations in the beef sector. My Department is currently working with different groups on both inquiries and applications.

New Markets

2015 was a very successful year for meat exports. Overall exports of beef, sheepmeat, pigmeat and poultry increased by €140 million to €3.5 billion.

The opening of the US market to Irish beef in early 2015 has provided an important outlet that holds enormous potential for future development given that we are the first EU Member State to gain access. In Quarter 1 of 2016 approximately 700 tonnes with a value of €6 million are estimated to have been exported, continuing the positive trends from last year.

Significant progress has also been made along the path to securing access to the Chinese market for Irish beef with the lifting of the BSE ban by China in February 2015, and an inspection visit by a Chinese delegation to Ireland was hosted in January 2016.  We are currently awaiting the report of this inspection team and preparatory work has commenced to help facilitate a follow-up visit, which we hope will take place later this year.

A wide range of other market access opportunities are being actively pursued at present; Israel, South Korea, Vietnam, Mexico and Ukraine. In addition, a Turkish delegation will visit Ireland next week to consider the potential opportunities for live exports.

Trade Issues - Mercosur

I have been very active in highlighting the potentially very damaging impact of a Mercosur deal on the European agriculture sector, and on the beef sector in particular. 

I am particularly concerned about a draft offer circulated to Member States ahead of a planned formal exchange of offers with the Mercosur bloc on 11 May. My misgivings are shared by a large number of my Member State colleagues who have spoken on this issue at recent Council of Ministers meetings, and we have been working together to ensure that these concerns are fully understood by the Commissioners for Trade and for Agriculture.

TTIP

As regards TTIP, I have emphasised previously the need to maintain momentum in these negotiations, given their importance for the EU and for Ireland, while recognising the agri-food sector has both offensive and defensive interests to consider.

Brexit

Moving on to the topic of Brexit, we know that the prospect of a UK vote to leave the EU presents potentially very significant challenges for Ireland. This is especially true from an agri-food sector perspective.

The figures speak for themselves. The UK is by far our largest trading partner. According to the CSO, in 2015 we exported almost €5.1 billion worth of agricultural products, and our imports from the UK were worth €3.8 billion.

Although there is still great uncertainty about the outcome and the changed landscape if the UK decides to leave, we have started to consider the likely arrangements to be made in the event of an exit vote. 

The treatment of four main areas will impinge on the agri-food sector;

  • Tariffs and Trade
  • EU Budget
  • Regulations and Standards
  • Customs Controls and Certification

Fisheries sector

With regard to our fishing industry, the possibility of Brexit poses a serious and complex situation as the UK is our second single largest market for seafood after France.  

The most complex fisheries issues are those related to the possibility of restricted access to fishing grounds and resources. 

The most likely approach would involve very complex negotiations to try and determine how mutual access to shared traditional fishing grounds could be maintained, and to address possible new sharing arrangements for fish stocks. 

It is obviously in Ireland’s interests for the UK to remain in the EU and this is particularly the case with regard to the agri-food and fisheries sectors. 

Fisheries - EU Points scheme

Before I conclude, I would like to touch on an issue currently facing the fisheries sector. I have been considering all of the concerns raised by deputies and by the fishing industry in relation to the implementation of the EU points system for serious infringements of the Common Fisheries Policy. In this respect, I met with representatives of the fishing industry this morning.

I have also asked the Attorney General, as a matter of urgency, to examine the Statutory Instrument which I signed into law at the beginning of March.   I have asked her, in particular, to consider the issue of whether there is a way that the assignment of points for licence holders can await the completion of the prosecution process, while at the same time ensuring that Ireland is fully in compliance with its obligations under EU law.  

It is my intention to report back to the Oireachtas as soon as I have received the Attorney General’s advice and I have examined a way forward in the context of that advice.   Subject to that advice, I would be open to amending the current SI to move further to meet the concerns raised in particular in relation to the assignment of points following the completion of the prosecution process. 

Landing Obligation and Pelagic Control

Turning to other immediate issues, the landing obligation or discards ban is being progressively implemented and will be of great benefit to Irish Fishermen in rebuilding fish stocks and allowing for higher quotas over time. Member States in the region, are working together and in consultation with stakeholders to agree modest steps for 2017 and to agree additional control measures for pelagic fisheries. The timetable for agreement on these measures is mid-May.

Conclusion

I have only had an opportunity to touch on a small number of current issues affecting the industry. This afternoon, there will be an in depth discussion on climate change issues and clearly this is an area which is at the heart of our approach to Foodwise 2025 and the growth of the agri-food industry. I look forward to contributions from colleagues and I will try and address any outstanding issues in my concluding remarks.

View this Statement as a PDF: Statements on Agriculture (pdf 181Kb) 

Date Released: 04 May 2016